MANAGE THE CHANGING COSTS
Of Medicare premiums with some help
Focused on maintaining your financial budget? You are not alone. During Medicare’s open enrollment period, many beneficiaries of the federal program are seeking help from financial professionals to set up next year’s budget to account for adjustments and increases in some Medicare monthly premiums.
The Centers for Medicare and Medicaid Services (CMS) has released 2022 premiums for those enrolled in Medicare Advantage and Part D prescription drug plans in anticipation of the annual open enrollment period of
Oct. 15 to Dec. 7.
CMS said it expects Medicare Advantage plan premiums to decrease from just over $22 to $19 a month in 2022, while projected enrollment continues to increase. However, the average monthly cost for Medicare’s drug prescription coverage plan is projected to rise from $31.47 to $33, or a 4.9% increase from 2021.
Insulin outlook
“CMS will continue to test the Part D Senior Savings Model in more than 2,100 plans in 2022, increasing access and affordability to select insulins for seniors,” stated CMS. “Over 500 new Medicare Advantage and Part D prescription drug plans, and two new pharmaceutical manufacturers of insulin, are joining the model this year to provide even more opportunities for eligible seniors to reduce their out-of-pocket spending on insulin.”
To help offset any monetary burdens the increase in Plan D premiums create or financial insecurity triggered by the pandemic, Amita Rani Gadalay, a financial specialist with American International Group (AIG) said speaking to a certified financial planner can help you create a plan that offers financial flexibility and a greater sense of security.
“Important, unavoidable fixed expenses like mortgages, utilities, car payments and – of course – insurance premiums need to be addressed first in a budget, but there is no such thing as a ‘one budget fits all.’ It all depends upon factors like annual income, age, risk tolerance, health condition and lifestyle, among other things,” Gadalay said. “The emphasis should be mostly on smoothing and protecting spending throughout the year and saving toward a goal.”
Gadalay recommended that Medicare enrollees work with a financial planner to help them understand their unique financial positions and where in their budget each person has f lexibility for expenses like health care premiums.
“A certified financial planner will not tell you to just cut costs, but … will, instead, give you guidance and suggest strategies that work specifically for your situation – strategies like tapping into savings to pay off items like mortgages because it’s a guaranteed safe return on your money. The whole goal of our life is not to accumulate wealth so people can charge us fees on our assets. It’s having the healthiest, best lifestyle we can, given our resources,” Gadalay said.
Medicare health and drug plan costs and covered benefits can change from year to year, so beneficiaries should analyze their coverage choices each year and decide on the options that best meet their health and financial needs, so they can adjust their coverage during the correct time before the deadline.